Monday, November 19 2018 18:39

ArmInfo. On November 19, the Government of Armenia at an extraordinary meeting approved amendments to the draft law "On the State Budget for 2019".  According to the Acting Minister of Finance of Armenia Atom Janjughazyan during the  hearings of the draft budget in the relevant committees of parliament  146 proposals were received from parliamentarians.

 Such factors as changes in the exchange rate of the currency, as well as expectations  for extra-budgetary funds also influenced the forecasted figures. As  Janjughazyan reminded, according to the RA Law on the Budget System,  the RA Law on the Budget is submitted to the National Assembly in  accordance with calculations as of September 1, after which in the  second reading, as a result of a change in the exchange rate, some  adjustments are made . Considering this fact as well, the Ministry of  Finance revised its forecasts for both the state budget revenues for  2019 and expenses: expenses were increased by about 5 billion drams -  from previously forecasted 1,642,189.7 billion to 1,648,063.1 billion  drams (1, 464.2 billion drams in 2018, 1,360.1 billion in 2017 and  1,420.6 billion in 2016). State treasury revenues also increased  adequately - from 1,490,589.7 billion to 1,496,463.1 billion drams  (22.1%) of GDP, of which tax revenues and state fees would amount to  1,401.8 billion drams (instead of the early forecasted 1, 399.2  billion drams or 20.7% of GDP, and 1.255.8 billion drams or 20.3% of  GDP in 2018). Other budget revenues will be 55.1 billion drams next  year (instead of 52.4 billion drams pledged in the initial draft and  23.9 billion drams for the current year, the official grants in the  updated version of the draft will grow to 39.5 billion from earlier  expected 39 billion. The target grants will amount to 30 billion  drams, while the grants within the framework of European cooperation  will be reduced to 858.4 million drams instead of the earlier  896, 9  million due to changes in the exchange rate of the currency.

Thus, according to the draft budget, in 2019 in conditions of  economic growth of 4.9% and growth of gross fixed capital formation  of 6.1%, the forecasted growth in exports of goods and services in  GDP will be 41% instead of the 38,7% expected by the end of this  year. According to the results of 2019, per capita GDP in Armenia is  expected to reach $ 4,604 instead of $ 4,280 forecasted by the end of  this year. At the same time, at the end of 2015, the figure was $  3,512. The nominal GDP of Armenia in 2019, according to the draft  budget for the next year, will grow by about 560 billion - from  6.193.0 billion drams expected by the end of 2018 ($ 12,752.6  million) to 6,756.2 billion drams ($ 13,717.5 million) pledged in the  project.  Community budgets for 2019 are estimated to be 138.9  billion drams (including official grants from the state budget) in  the line of income, and 138.9 billion drams are expenses. This year,  a figure of 130.1 billion drams was laid. The ratio of investment to  GDP in 2018 is projected at 23.3% instead of 23.6% in 2019. 12-month  inflation is expected to be at the level of 4% with an allowable  fluctuation limit of  1.5%.

The deficit will total about 151.6 billion drams or 2.2% of GDP,  against 156.9 billion drams pledged for 2018 or 2.7% of GDP, but  revised to 103.5 billion drams (1.7% / GDP ). 54.1 billion drams will  be financed using internal resources, and 97.5 (instead of the  initial 91.4 billion drams) by external sources.  The deflator index  will be 104%, against 104.4% forecasted by the end of this year.

As a result of parliamentary adjustments, the Ministry of Transport  will receive more funds- from 21,529,815, 4 thousand drams to  22,741,755.6 thousand drams, Ministry of Education will be allocated  126 859 192.4 thousand drams instead of 126 834 451, 6 thousand  drams. Expenses for social and cultural events will be increased: the  Ministry of Culture will receive by 435 million drams more - up to  15.584 billion drams, sports sector will receive instead of the  previously planned 2.6 billion drams  2.8 billion drams, health care  by 12.3 million more - up to 87 , 1 billion drams, allocations of  science will grow by 2.5 billion drams  to 16.8 billion drams.   Funding of security officials will also increase from 345.062 to  345.185 million drams.

Next year, as a result of fiscal policy, the level of public debt  will be stabilized. Thus, it is expected that the ratio of public  debt to GDP will decline from 55% projected by the end of 2018 to  53.43% of GDP, and the ratio of government debt to GDP by the end of  2018 will be reduced from 53.4% to 49.7 % In general, by the end of  2019, the state debt will grow to $ 7.468 billion with the expected  budget for the current year of about $ 7.2 billion, or $ 7.053  million revised by the Ministry of Finance or 55% of GDP, and the  government debt will make $ 6 billion 844.5 million (the estimated  exchange rate of the Armenian dram to the dollar is $ 1 = 483.38  drams). In 2018, it is expected to attract credit resources in the  amount of $ 446 million, of which $ 31 million through the Central  Bank. In 2019, it is planned to raise $ 512 million, through the  Central Bank line $ 21 million. About 10% of budget expenditures will  be spent on servicing state debt - about 158 billion drams.

To note, the draft budget of Armenia for the 2019 year was approved  by the government on September 27.  Discussions on the main financial  and economic document in the National Assembly started on November 1.   The document is for the first time fully built in the format of  program budgeting, which "promises" the country not only quantitative  indicators, but also qualitative ones. The profile committee of the  parliament on November 12, with a positive conclusion sent the draft  budget for 2019to the discussion of the plenary session of the  National Assembly. Tomorrow, November 21, it is expected that the  main financial and economic document of the country will be approved  by Parliament.